What the Fed Rate Cut Means for Markets
What’s in Today’s Report:
- What the Fed Rate Cut Means for Markets (A Vote for the Run Hot Economy)
Futures are moderately higher following a mostly quiet night of news as investors digest Wednesday’s rate cut and the prospect of even lower rates in the future.
Economic data underwhelmed overnight as Japanese Machine Orders dropped (–4.6% vs. (E) -3.5%) while Australian employment fell –5,400 vs. (E) 22k.
Today we get a rate decision from the Bank of England (no change is expected) and some notable economic reports: Jobless Claims (E: 246K), Philly Fed (E: 3.0) and Leading Indicators (E: -0.1%). With the Fed now cutting rates, stable and solid economic data is needed to support a further rally in stocks. If economic data begins to roll over, however, that will be a new negative for markets because it’ll imply the Fed waited too long to begin to cut.
On the earnings front, some notable reports include: DRI ($1.99), FDX ($3.65), LEN ($2.12).